Credit card application, a review of the topic
Having a prepaid credit card is like having an ATM card without a bank account: The money comes directly from an account you have with the credit card company, and you refill the account periodically. Because the money is deducted from your account immediately rather than hanging in limbo until you pay it like a regular credit card, prepaid credit cards charge no interest. Credit card issuers make a profit by charging you fees when you open the account and when you deposit more money into your account. Prepaid credit cards usually function just like regular credit cards, and you should be able to use them for most purchases. However, if a business, like a hotel, wants to place a temporary hold on your account, or if a purchase requires regular withdrawals from your account (for example, if you want to pay your monthly car insurance payments via credit card), then you may need to use a regular credit card instead.